24 April 2017Insurance

AIR Worldwide launches new cyber modelling tool

Catastrophe modelling firm AIR Worldwide, a Verisk Analytics business, has unveiled a cyber risk modelling application for the re/insurance market that will provide underwriters and risk managers with a variety of cyber analytics.

The ARC (Analytics of Risk from Cyber) tool is designed to evaluate any commercial policy, including those vulnerable to silent cyber, measure and monitor aggregations of cyber risk within a portfolio, and estimate potential insured cyber losses for portfolios, the company said.

"Insurers typically have very little information about the cyber risk characteristics of the companies they insure and instead rely on a crude market-share approach," according to Scott Stransky, assistant vice president and principal scientist at AIR Worldwide.

"ARC takes advantage of the detailed information that AIR has compiled on companies to help insurers identify their sources of aggregation risk and to determine with greater certainty which of their insureds would be affected by various aggregation scenarios."

Laila Khudairi, underwriter at Tokio Marine Kiln, commented: "Understanding an insured’s virtual supply chain is a critical first step toward managing systemic cyber risk within a portfolio. A global database of exposures such as the one underlying ARC gives us more confidence that the modelled loss estimates reflect the risk within our portfolio."

As part of the new cyber application, AIR offers a variety of cyber scenarios, such as cloud service provider downtime, accidental data breach, and blackout, that can be used to estimate the financial impact of a defined event on an individual company or portfolio. With the ability to modify severity parameters, risk managers can implement their own view of the risk, test the sensitivity of portfolios to different event circumstances, and explore the impact of adjusting cyber policy terms.

A cyber risk consulting practice is also available to help clients augment the cyber exposure information in their existing books of business and to produce custom reports on aggregation risk and the probability of breach, the company said.

Today’s top stories

Cyber insurance needs to be considered as standalone line: JLT Re

Risks to global businesses become more volatile and complex: Aon

JLT re-hires senior exec to expand US specialty unit

Marsh partners with Schinnerer Group and Nephila on new venture

Hamilton Re acquires Sompo Canopius excess casualty renewal rights

Willis Towers Watson appoints head of broking North America

Did you enjoy reading this story?  Sign up to our free daily newsletters and get stories like this sent straight to your inbox.

Already registered?

Login to your account

To request a FREE 2-week trial subscription, please signup.
NOTE - this can take up to 48hrs to be approved.

Two Weeks Free Trial

For multi-user price options, or to check if your company has an existing subscription that we can add you to for FREE, please email Elliot Field at efield@newtonmedia.co.uk or Adrian Tapping at atapping@newtonmedia.co.uk

More on this story

24 April 2017   The cyber insurance market will become more resilient if it is considered as a standalone line of business rather than a peril, according to JLT Re.
Alternative Risk Transfer
24 July 2017   Catastrophe risk modeling firm AIR Worldwide, a Verisk Analytics business, has launched the industry’s first comprehensive severe thunderstorm model for Australia that explicitly captures all three sub-perils — hail, tornado, and straight-line wind - to help companies assess and manage severe thunderstorm risk.
8 August 2017   Even with modern flood-control structures, the risk of flood damage remains high in Japan in the aftermath of Typhoon Noru, which made its first landfall in Yakushima, an island in Kagoshima Prefecture, Japan, as a Category 1-equivalent storm, before making a second landfall near Kainan City in Wakayama Prefecture, Japan, according to catastrophe modelling firm AIR Worldwide.